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OTTAWA, Jan. 02, 2020 (GLOBE NEWSWIRE) — HEXO Corp. (“HEXO” or the “Company”) (TSX: HEXO; NYSE: HEXO) today announced it has completed the filing of its restated audited annual consolidated financial statements for the fiscal year ended July 31, 2019 (the “Restated Annual Financial Statements”) and corresponding amended management’s discussion and analysis, and its restated interim condensed consolidated financial statements for the three-month period ended October 31, 2019 (the “Restated Interim Financial Statements”) and corresponding amended management’s discussion and analysis.
As contemplated in the Notice to Reader included in the Company’s previously filed interim financial statements for the three-month period ended October 31, 2019, the Restated Annual Financial Statements were filed to correct identified errors in the Company’s previously filed financial statements for the fiscal year ended July 31, 2019, in which the deferred tax liability was overstated as at July 31, 2019, as it was not offset by a deferred tax asset relating to a tax loss generated in one subsidiary against a deferred tax liability generated by a separate subsidiary.
Additionally, net loss for the year ended July 31, 2019 was overstated by $14.3 million.
Due to the two tax positions existing in two separate entities, the Company’s original position was that they could not offset or reduce one another. The applicable subsidiaries were amalgamated on August 1, 2019. The correction of this error resulted in a reduction of the deferred tax liability and deficit by $14.3 million as at July 31, 2019. Additionally, net loss for the year ended July 31, 2019 was overstated by $14.3 million.
In assessing the financial impact of subsequent events for the restatement, the Company has also adjusted its audited annual consolidated financial statements for the fiscal year ended July 31, 2019 for the estimated fair market value of its cannabis trim based inventory due to new and available third-party information, resulting in an increased impairment on inventory of $2.4 million. The inventory impairment resulted in a $2.4 million reduction of the impairment loss on inventory for the interim financial statements for the three months ended October 31, 2019.
The Restated Annual Financial Statements, Restated Interim Financial Statements and corresponding amended management’s discussion and analysis are or will be available on SEDAR at Buy Valium Mastercard Online and copies of the Supplement and the Registration Statement are or will be available on EDGAR at Cheap Valium Australia.
This article is written and published by The Cannabis Stock
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